Confident Thus bucking the trend

TELECOMS and internet group Thus remains confident about its future prospects after seeing a jump in underlying earnings.

The Glasgow-based company said it bucked challenging market conditions in the last three months of 2001 with continued growth in revenue.

Thus, due to split from its majority owner Scottish Power, provides voice and data services to corporate clients and also owns internet service provider Demon. Turnover in the three months to December 31 - the third quarter of the group's financial year - was 26% higher than the prior year at £75.3m.

The group said tight cost controls helped underlying earnings for the period come in at £6.6m, up from negative earnings of £4.7m a year ago. The performance means Thus has produced positive earnings for the first nine months of its financial year so far.

Chief executive William Allan said the results were 'another positive step forward' for the business. He added: 'Against challenging market conditions, we have achieved continued growth and strong margin improvement. We look forward to the future with confidence.'

Turnover in Thus's core data and telecoms division increased 59% to £42m in the third quarter with residential telephone service revenue at £300,000. Internet revenue rose 9% year-on-year to £22.2m on strong growth from the group's business-orientated internet services.

Thus added that growth at its Demon ISP arm would be fuelled by its selection as the default ISP in Apple's new Apple Mac OS computer.

Operating losses for the third quarter across the group were £10.8m, down 22% on the same period a year ago, and 33% less than the previous quarter.

Thus sold off its ClubCall, RaceCall and WeatherCall phone services in October to mobile media firm itouch. It is now in exclusive negotiations over the sale of its Creative business and a completion is expected before the end of the financial year in March.

Thus outlined plans last month that will see it cut its ties with Scottish Power and expects the break to be completed in two months' time.

A £275m share placing by the telecoms group forms the central part of the break-up and Thus said this open offer was now underway.